Need for Speed: How to Get Your Offer Accepted in the Ultra-Competitive Bay Area Real Estate Market
7 Hot Tips for First-Time Home Buyers
These days, if you want to buy a home for sale in Oakland, Concord, Walnut Creek, or any of the other competitive East Bay markets, you’ll have to be lightening fast. That’s why we complied a list of 7 essential tips to help clients, especially first-time home buyers, ramp up their speed.
The challenge is buyers must nimbly navigate this sellers’ market, where the low number of property listings doesn’t match the high number of hopeful home buyers. That means today’s sellers can confidently ask bidders for a lot – including a quick close.
Nationally, the average home sat on the market for 53 days this fall. In the Bay Area, however, the median number of days it took to sell a single-family home was just 13, down from 23 days the same time last year, according to a California Association of Realtors report. Meanwhile, Abio Properties agents are seeing some deals close in even fewer days!
Your best strategy in such a fast-paced environment is to be ready to make an offer before you actually find the house of your dreams. Here’s how:
7 Hot Tips for First-Time Home Buyers
1. Partner with a real estate agent, if you haven’t already
The first step in winning a home for sale in Oakland or other popular market is interviewing prospective real estate agents. Ask about how well they know your target neighborhood, their fees, and what services they offer beside negotiations and escrow. Ask them how they handle multiple offer scenarios. And always request references from past clients.
2. Get your docs in a row
Avoid the nerve-racking stress of hunting down your financial documents after you’ve seen the house of your dreams and want to make an offer. You will lose out to a more organized buyer who was ready to submit a fully qualified offer. Create a Green File (green for money, get it?) that includes:
- Pay stubs from the past 30 days
- W-2 forms from your employer from the last two years
- Federal tax returns for two years
- Checking and savings financial statements (for the last 60 days)
- Statements from investment accounts such as IRAs, mutual accounts, stocks, bonds
- Credit card information
- Auto loans
- Records of other debts
- Investment property records
- 401K statements
- Life insurance
- Residential history for the past two years
- Proof of funds available for down payment and closing costs. If these funds are coming from a secondary source, such as a 401K, gift funds, etc., be prepared to provide documentation for that, too.
3. Clean up a poor credit score
Depending on your lender, anything less than 650 will exclude you from getting a conventional home loan. Scan your report for discrepancies and accounts you don’t recognize.
4. Pay off as much debt as possible
Most lenders won’t approve you for a mortgage if your debt-to-income ratio exceeds 43 percent.
5. Beef up your savings
Lenders generally like to see that you have enough in the bank to make a 20 percent down payment, according to Realtor.com.
6. Get pre-approved for a mortgage loan
Now that your credit is clean and your savings are beefy, meet with a lender to get pre-approved. Pick a lender who offers you the best combination of interest rate, loan program and quality service. Don’t have one? Ask friends, your trusted Realtor or financial accountant for recommendations.
7. Have a love letter ready
Write a heartfelt letter to sellers about why you want their home. Start with a template of sorts that you can customize to the specific home you are bidding on. Check out examples from Abio here.
Now you’re ready. On your mark… GO!
Want more first-time homebuyer tips about how to be nimble when looking at homes for sale in Oakland and other competitive markets? The agents at Abio Properties are limber and ready with solid experience, market trend knowledge, and resources. Contact us at 888-400-ABIO (2246) or firstname.lastname@example.org.